BPU only approves three grid-supply projects out of 57, shunting others to brownfields and landfills .

In an action taken earlier this week, the New Jersey Board of Public Utilities only approved three out of 57 applications pending before the agency to build so-called grid-supply projects on farmland.

Grid-supply systems directly feed electricity from local solar arrays into the regional power infrastructure.

The decision is significant because the state’s solar energy market is in turmoil, with the price of solar credits paid for the electricity systems produce dropping dramatically in the past two years. The falling prices are mostly blamed on overbuilding solar systems in New Jersey, a problem stemming from the lucrative state and federal incentives available to developers.

Many in the industry worried that if the BPU approved a significant number of farm projects, it would further swamp the market with solar credits, again driving down prices and drying up investment. All told, the projects would generate roughly 640 megawatts, more than half of the solar capacity built in New Jersey in the past decade.

In the end, the BPU only approved some 12 megawatts of new solar capacity on farmland. The projects included NJ Clean Energy Ventures, a 6.69-megawatt facility in Medford; a 3-megawatt farm by OCI Solar in Holmdel; and Sun Perfect Solar’s 2.3-megawatt system in Pittstown.

The state’s new Energy Master Plan discourages building big grid-supply projects on farmland, instead trying to direct development to underutilized brownfields and landfills. That objective would be partly realized by a draft settlement between the BPU and Public Service Electric & Gas, which would give the utility the go-ahead to develop 42 megawatts of new solar capacity on brownfields and landfills.

That proposal is expected to come up for a vote before the BPU later this month, but its meeting this past Monday was packed with developers eager to see how the agency would act on their applications.

In approving only three projects, BPU staff noted that all three should be fully operational by June. Seven other projects were deemed not to meet the statutory requirements of a law promoting solar passed last summer. Twenty-six
projects also were not given the green light because they lacked some of the necessary federal and state approvals. In addition, the agency deferred action on another 21 projects.

His fellow BPU Commissioner Joseph Fiordaliso agreed. “We have to protect the precious few farms that we have left in New Jersey,’’ he said.

What happens to the remaining solar farm projects not approved by the BPU remains to be seen. Some solar developers said they expect some to seek approval under another provision of the solar law passed last summer, which allows the agency to approve 80 megawatts of grid-supply projects each year over the next three years.

The application for those projects is expected to begin in mid-May, according to BPU staff.

Many of the developers seeking approval from the BPU have been in the pipeline for a long time and are looking to be grandfathered in. They have already been processed by the second phase of review by PJM Interconnection, the regional operator of the nation’s largest power grid.